When it comes to enhancing marketing outcomes, much emphasis is often placed on distribution channels and determining the ideal media mix. In the past, when media expenditure accounted for a larger share of overall marketing budgets, this approach was logical. However, during challenging periods, it becomes crucial to ensure that all marketing operations run efficiently.
These days media spend comprises about 25.1% of total marketing budgets, according to Gartner. But labour costs — taking internal teams and external agencies and suppliers together — comprise about 48% of marketing budgets, according to the same study. Incidentally, martech spending is also on the rise, at 26.6% in 2021.
That means marketers who want to get the best bang for their marketing spend or quickly find some upside should turn some of their attention to optimising both their internal processes and the way they work with their agencies.
There are layers of hidden costs built into inefficient marketing processes. Think of them as parasitic organisms, silently gobbling time, resources and money and essentially making it harder than it needs to be for marketing teams to get their work done, and for CMOs to generate profitable revenue growth.
Here are 10 of the most common hidden costs, and some tips on how to avoid them.
More than 50% of marketing teams have no documented marketing workflows. And if you haven’t documented or tracked them, it’s hard to see where the bottlenecks are and how they can be improved. Often these occur when work is handed from one team or person to another to go through a review and approval process. All too frequently, expectations are not set around how quickly this must be done, and lead times stretch from days into weeks.
Over the time it takes to create one multi-channel campaign, this can easily add months to your go-to-market timeframe. Inevitably that makes it hard for your marketing team to be agile and react quickly to take advantage of new opportunities. It also means you end up with fewer campaigns in market over a set period, reducing your chances of building marketing momentum and growth in your organisation. This is one of the major opportunity costs most marketing teams experience.
What can you do about it?
READ NEXT: 5 Essential Workflows for Time-Poor Marketers
Most marketers spend between 20% and 60% of their time on administrative tasks such as liaising with stakeholders and agencies, chasing information and following up approvals rather than doing their core marketing work.
Then there’s the job of collecting and reporting back to the business everything marketing has been working on — weekly, monthly or according to whatever your organisation’s needs are.
There’s an expectation that these tasks should take care of themselves — but that is rarely the case.
The costs in staff time lost to a marketing team are significant: at one customer, 20% of the working time of a small team was spent liaising between stakeholders and agencies.
Removing this is like bringing an additional staff member onto the team at no additional cost.
What can you do about it?
Optimising the media mix is one thing: but it’s shockingly common for marketing teams who have pre-booked media deadlines to pay more than they need to for media bookings because new creative work was not completed in time.
Sometimes it means old creative is re-run instead; often it means media ad space is re-booked at late notice.
Not only does that reduce the time in market your new messaging will have, it can attract significant media cost penalties: early media bookings commonly attract discounts of between 20% and 40%, and meeting these is an important discipline for a well-run marketing team.
What can you do about it?
In the same spirit, the people doing the work in marketing teams are often not acquainted with the terms of their agency contracts, which obscures the cost of returning the creative work to the agency to amend 4 or 5 times instead of sticking to whatever the terms of your service level agreement are: often 3 review rounds.
In addition, poor briefing will push out the time it takes a campaign to get to market.
It’s not usually in the agency’s interest to bring these types of issues to your team’s attention: they will simply charge you for the additional work outside the terms of your agreed service level agreement.
These charges can be significant: according to one study, agency principals estimated 30%* of agency costs were wasted due to poor client communications.
What can you do about it?
READ NEXT: 4 Sure Ways to Improve Your Agency Relationships
Once a campaign or marketing activity has been completed, marketers typically become engrossed in the next project and forget that existing creative assets can be reused for significant efficiencies. In fact, one in three creative assets ends up going unused or being under-utilised, according to a report from IDC. The same report found a 10% cost benefit to more efficient management of your digital creative assets, enabling marketing teams to use, re-use, edit and use assets again without having to go back to the creative agency.
What can you do about it?
What typically happens when your CMO or senior marketing personnel leave?
The first thing to suffer is your marketing cadence: work slows down or stops while new approvers are found and permission is gained for work in progress. Then there’s the onboarding process — when new staff come on board, in the absence of clearly communicated processes, they will revert to however they got work done in their previous job.
The only thing you can bet is that it will be different from however it gets done in your company.
And there’s no guarantee they are across all the regulatory requirements, or even know who to approach in your marketing risk and compliance team to get that information. The opportunity cost to marketing teams, again, is not getting work to market in a timely fashion, as well as increased risk of regulatory breaches during times of change.
What can you do about it?
Ad hoc processes, or even documented processes that are not followed all the time or by all team members can result in non-compliant or unsafe brand material going to market, creating regulatory and reputational risks.
The cost associated with this can run the gamut from lost sales due to reputational damage to creative materials being pulled off air, fines, increased scrutiny from regulators and the cost of making reparations or implementing more stringent compliance programs.
What can you do about it?
Marketing technology now soaks up 26.6% of budgets, according to Gartner’s latest research on the topic — and this figure is rising. Most marketing teams use between 6 and 10 tools every day but many are not properly utilised. In addition, they are often poorly integrated, causing processes to break down.
What can you do about it?
READ NEXT: 9 Tips for Getting a Better Return on Your Martech Investment
When marketing technology is used by one team and the results are not centrally accessible, information silos result. Marketing goals and results become disconnected, outcomes fall between the cracks and marketing campaigns are rarely optimised to maximise results. That means your marketing will not be as effective as it might have been.
For example, you may track results from your email marketing program through your marketing automation tool. But if these results are not integrated with the results from other digital channels, such as your retargeting activity during the same period or your website analytics, complete and actionable outcomes of your campaign may be lost.
What can you do about it?
Most marketers are now in charge of the customer experience at their organisation, and while most marketers value consistency of messaging, creative execution and brand personality, many struggle to achieve it.
A significant majority (59%) of marketers report responsibility for managing the customer experience now rests with the chief marketing officer or marketing team at their organisation, according to our study, Marketing Operations in the Age of Intelligence. And almost nine in 10 (87%) rate brand consistency as extremely or very important. But a majority of marketers rate their own brand consistency poorly across key attributes:
Poor brand governance practices across separate or dispersed teams can lead to inconsistent messaging and creative execution, creating a disjointed customer experience that can impact on your business.
What can you do about it?
The good news is that it’s relatively quick to realise savings from addressing the 10 hidden costs of marketing.
According to Forrester, the advantages of establishing better connections between teams, workflows, measurement, and assets come immediately when addressed with the implementation of a marketing resource or marketing operations management system, with many customers seeing a return on their investment within the first year.
Discover how Simple Admation can empower you marketing team to unlock their full potential. By working smarter, faster, and leaner, your team can achieve unprecedented success. Chat to us today.